Russia cannot spend Indian Rupee.
Russia is a major exporter of oil and gas to India. In 2022, India imported about 80% of its oil from Russia. This dependence on Russian oil has increased since the start of the Russia-Ukraine war, as India has been looking for alternative sources of oil.
India is also a major importer of fertilizers from Russia. These fertilizers are essential for Indian agriculture.
In recent months, Russia has been looking to increase its trade with India in rupees. This is part of its efforts to reduce its reliance on the dollar, which has been under sanctions by the US and its allies.
In May 2022, the Reserve Bank of India (RBI) allowed Indian oil companies to make payments for Russian oil in rupees. This was a significant development, as it opened up the possibility of using rupees for other trade with Russia.
However, it is not yet clear how quickly or easily Russia and India can move away from using the dollar. The dollar is still the most widely used currency in the world, and there are many businesses and financial institutions that are reluctant to give it up.
The Indian government has imposed sanctions on Russia in response to its invasion of Ukraine. These sanctions include restrictions on trade and financial transactions. As a result, Russians are unable to use Indian Rupee to purchase goods and services from India.
The sanctions are having a significant impact on the Russian economy. The value of the Russian ruble has plummeted, and inflation is soaring. The sanctions are also making it difficult for Russian businesses to operate.
The Indian government has said that the sanctions are necessary to deter Russia from further aggression in Ukraine. However, the sanctions are also having a negative impact on the Indian economy. India is a major importer of Russian oil and gas, and the sanctions have made it more expensive for India to buy these commodities.